There are many indicators that show that SNV will come out of the crisis a better bank.
* Loan losses are being diminished over time and the ratio of quality loans to non-performing assets is increasing
* Management 'cannot understand' why SNV is trading at such a low multiple. The management, I believe, are straight-shooters unlike the crooked managment we had in myriads of companies that went bankrupt. They did a secondary at $4/share four months ago at a price they believed was fair based on their financial position at that time.
* SNV is a $35 Billion dollar company and it is a major player in the Southern region which makes it an attractive target for a buyout. Commercial real-estate will come back at some point in time. Real estate is cyclical, with periods of boom and bust. We are on an upswing from a bust cycle.
* SNV declared a dividend in December 2009. Companies who are struggling to survive do not generally payout dividends to their shareholders.
* The best time to buy a stock is when there is maximum fear regarding the survivability of a company. If the company survives, which I believe it surely will, the rate of return on your investment will be exorbitantly high.
* Folks like Tom Brown make valid arguments on why SNV could be a 5-bagger in just 2 years.
I would also like to add ...that a struggling company would never put into effect a 2.00% salary increase to the majority of their employees. Richard anthony e mailed all snv employees a few days ago and told them that the majority of them will be getting a 2.00% increase in february. Think about that people.... This means that snvs core financial health is great or at least is on the right path don't you think?????
I have been saying for months that things were getting better. Let those that will sell their stock to shorts so they can cover and go long. Synovus is undervalued. Worth a hell of a lot more than $2.72 a share. One of the only banks I know that has more cash on hand than debit. Yes these are hard times but even with the mistakes they have made we will get back on top. Synovus is going to get a buyout. It`s going to be about $11 dollars when it comes . The reason it will is we don`t need to sell so you either pay a fair price or no deal. Many will say its not worth that much. I say just look at the debit of BBT or a STI. Look at your WFC or BAC. BBT should be down here where we are. They are so far underwater it is unreal. Synovus is not. Any big bank as JPM will use the new tax credit on writing down loans and pay nothing for Synovus even after paying us $11 dollars a share. If I was RY or JPM I would be buying them now . Those that see the future of this company are buying all they can. Those that are day traders or short enjoy living in the fast lane. Buy now or become road kill.
lionheart..............I am long, but I have seen many companies give raises prior to going out of business. Thursday we will know the truth. No CEO lies because they want to. they do it to protect the stock. After dilution, SNV was taken down to a level where if they had to dilute again, it would destroy the company. Do not trust CEO's so much..........They twist truth a lot, that is why they are CEO's.
FWIW ... I spent years calling on banks all over the state of GA. From my own personal experience ... and other bankers ... other vendors, this bank enjoyed a reputation as being extremely well managed. The guys I met were first class. The references on this board to the contrary are simply idiotic. SNV will do more than survive. Sure, it's a buyout candidate, but that was true anyway ... just a tad more attractive in the near future.
"Commercial real-estate will come back at some point in time."
If I'm not mistaken, the bulk of SNV's RE loans and PROBLEMS are in residential (a lot of money lent to builders of residential RE?). I'm near ATL, a major problem area (as is FL) and not sure it's coming back very well.
fyi: I'm bullish on SNV (and Tom Brown's analysis) but just wanted to clarify...
Good point on the residential real estate! Yes, ATL and most of their Florida markets remain soft. Per 3rd Quarter call, 56% of NPL was residential, with 22% of it in ATL. And 40% of their commercial loans are owner occupied, which tends to hold up better than investor property. Commercial/Dev. loans accounted for 8.5% of NPL, Hotels accounted for 1.1% of NPL excluding Sea Island loan (22.5% of NPL with Mr. Jones loan included!)
If any of you want a source for residential appreciation/depreciation a website for that is available from Federal Housing Finance Agency, fhfa.gov is the site. Must be taken with a grain of salt, since their data incorporates both actual sales and also appraised values on refinances.
Some of markets Synovus in with past 3rd Qtr.,2009 and last 12 months +- shown:
Georgia: Atlanta (-3.74, -5.07) Athens (-3.74, -1.07) Augusta (-1.87, -1.98) Columbus (-3.10, -2.27) Macon/W.Robins (-3.49, -3.77) Savannah (-2.79, -3.33)
South Carolina: Anderson (-2.90, -1.97) Charleston (-3.42, -5.79) Columbia -2.62, -1.10) Florence (-0.17, +0.82) Greenville (-1.54, +0.27) Spartanburg (-2.42, -1.62)
Florida: Ft. Myers (-4.71, -12.86 OUCH!) Jacksonville (-3.19, -9.69) Naples (-2.50, -12.30) Panama City (-3.81, -9.76) Pensacola (-0.58, -4.80) St. Petersburg (-3.41, -11.39) Tallahassee (-2.70, -7.23)
Alabama: Birmingham (-2.35, -1.60) Mobile (-1.13, -0.76) Montgomery (-2.01, -2.24) Tuscaloosa ROLL TIDE -0.74, -3.44)
Tennessee: Chattanooga (-0.56, -0.25) Memphis (-2.64, -2.24) Nashville (-2.07, -2.14)
Sound points. Going forward, the price may be tied to to dividend increases. SNV was once a solid "grandpa" stock that attracted those that craved steady income. TARP interest and repayment may make that problematic in the near term, though a positive outcome is more likely at an indefinite point in time. Confidence in Management is another metric that currently negative. A small positive from The People's Republic of Mass. is Rinos 1, Socialists 0. Good luck.